Income tax

Rates

Income tax is levied on income after deduction of the personal allowance. Income along with the final earned income and dividend income will be taxed in a specific order. Income and Savings Income Dividends and savings allowances are still a part of an individual’s total revenue. The starting rate applies only to band savings income. 0% rate is not available if the entire starting rate subject to tax on non-savings income exceeds the band.

The Scottish Parliament sets the income tax rates, and these rates are the rates applicable to non-savings and dividend income for Scottish residents. Income tax is paid to Wales on non-savings dividend income. Welsh resident taxpayers continue to pay the same amount of income tax rates using UK rates and bands. Total income tax rate = UK income tax + Welsh rate of income tax. Savings income and dividend income are taxed using UK tax rates and bands.

TypeBand of taxable income (£)Rate (%)Rate if dividends (%)
Starting rate for savings0 - 5,0000N/a
Basic rate0 - 37,500207.5
Higher rate37,501 - 150,0004032.5
Additional rateOver 150,0004538.1